How do tariffs affect the world of cryptocurrencies? 🚀
Tariffs, or taxes on imported goods, not only affect the products we buy but also extend to our financial markets, including cryptocurrencies! Here are the top 3 points you need to know:
1. Volatility and Uncertainty:
When governments announce new tariffs, anxiety and uncertainty in the markets increase. This drives investors away from assets considered 'high risk' like cryptocurrencies and towards safe havens, which may lead to a decline in cryptocurrency prices in the short term. Remember what happened in 2025 with the increase in U.S. tariffs on Chinese imports!
2. Inflation and Mining Costs:
Tariffs on imported goods raise the prices of imported products, which means greater inflation! To combat inflation, central banks may raise interest rates, reducing the flow of money toward investments, including cryptocurrencies. Most importantly, the cost of mining cryptocurrencies may rise due to tariffs on mining equipment and imported semiconductor chips, affecting miners' profitability.
3. Cryptocurrencies as a Safe Haven?
In the long run, if tariffs lead to a weakening of national currencies and worsening inflation, people may turn to cryptocurrencies, especially Bitcoin, as a 'store of value' or 'safe haven' to protect their money. We have already seen this happen in countries suffering from economic instability where reliance on cryptocurrencies has significantly increased.
Do you think Bitcoin will become a true safe haven in future economic crises? Share your thoughts with us! 👇
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